Milton the quantity theory of money, the supply
Milton Friedman was an American economist and statistician, was best known for his strong belief in free-market capitalism and was also known as the father of economic freedom. He lived on the East Coast and was born on July 21st 1912 in New York City and died on November 16 2006 in San Francisco. His subjects of study included money and guaranteed minimum income and he believed economics was not a game, but that it was the key to understanding how the real world works. He was able to receive a scholarship to Rutgers University, studied mathematics and economics, and earned a bachelor’s degree there in 1932, attended the University of Chicago in 1933, went back to earn his Ph.D in 1946 and later on went on to Columbia. During his time as professor at the University of Chicago, Friedman developed several contradicting free-market theories that were well viewed by traditional Keynesian economists. He later went on to receive the 1976 Nobel Memorial Prize in Economic Sciences for his research on consumption analysis, monetary history and theory, and is responsible for its current popularization. His work includes monographs, books, scholarly articles, papers, magazine columns, and even television programs. He was able to Co-author, with Anna Schwartz in the book A Monetary History of the United States, 1867–1960 (1963), which analyzed the money supply and economic activity in U.S. history. His books and essays had a global impact, even with former communist states. He was best known for causing more interest in the quantity theory of money. In Friedman’s restatement of the quantity theory of money, the supply of money is independent of the demand for money. The supply of money is unstable because of monetary authorities, while also claiming the demand for money is stable. It means that money which people want to hold in cash or bank deposits is related in a fixed way to their permanent income. Friedman’s reformulation of the quantity theory of money has brought so much controversy and has led to empirical verification on the part of the Keynesians and the Monetarists. Some of the criticisms levelled against the theory are discussed as a very broad definition of money, does not consider time factor, and his wrong representation of money supply and money GNP. Although there are several criticisms, i believe this is a very strong development in monetary theory since its theoretical significance lies in the conceptual integration of wealth and income as influences on behavior and he was able to save millions or billions of people from decades of oppressive statism.